News Release

Biomass Crop Assistance Program to Spur Production of Renewable Energy, Job Creation

USDA Farm Service Agency Seeks Comments on Proposed Rule

WASHINGTON, February 3, 2010 – As President Obama announced earlier today, the U.S. Department of Agriculture today issued a proposed rule for the new Biomass Crop Assistance Program (BCAP) that intends to spur the expansion of dedicated non-food crops for renewable energy and biofuel production. A public comment period will continue for 60 days after the rule is published in the Federal Register.

"Advancing biomass and biofuel production holds the potential to create green jobs, which is one of the many ways the Obama Administration is working to rebuild and revitalize rural America," said Agriculture Secretary Tom Vilsack. "Facilities that produce renewable fuel from biomass have to be designed, built and operated. Additionally, BCAP will stimulate biomass production and that will benefit producers and provide the materials necessary to generate clean energy and reduce carbon pollution."

Authorized in the Food, Conservation, and Energy Act of 2008, BCAP is designed to ensure that a sufficiently large base of new, non-food, non-feed biomass crops is established in anticipation of future demand for renewable energy consumption. BCAP is intended to reduce the financial risk for farmers, ranchers and forest landowners by providing incentive payments to those who invest in the production, harvest, storage and transportation of new first-generation energy crops that displace hydrocarbon-based materials now used for heat, power and vehicle fuel.

On May 5, 2009, President Obama issued a Presidential Directive to accelerate the investment in and production of biofuels. On June 11, 2009, a notice of funds availability (NOFA) was published for certain portions of BCAP, and the USDA Farm Service Agency (FSA) issued the first payment in August 2009. Early program beneficiaries to date include a Vermont school that will replace 100 percent of its fossil fuel consumption with biomass, a start-up pellet company that uses locally-grown agriculture residues from Iowa farms and a rural electric cooperative that displaces fossil fuels with woodchips to generate low-cost electricity in northeastern Georgia.

BCAP is authorized to fund two main types of activities. First, it provides funding for agriculture and forest land owners and operators to receive matching payments for eligible biomass materials sold to qualified biomass conversion facilities for the production of heat, power, bio-based products or advanced biofuels. The payment rate is intended to assist producers with the cost of collection, harvest, storage and transportation of the biomass to the facility, for up to two years. This is the part of the program covered by President Obama's Presidential Directive.

Additionally, BCAP will provide funding for producers of eligible renewable crops within a select geographical area to receive payments up to 75 percent of the cost of establishing the crop and annual payments for up to 15 years for crop production.

Other proposed notable goals of BCAP include improvements in forest health by removing uneconomical forest thinning, reducing the risk of disease, invasive species and forest fires and providing new options for improving air quality by avoiding open-air burning of scrap biomass.

A copy of the proposed rule is available online at www.fsa.usda.gov/bcap. Comments on the proposed rule are invited and may be submitted to: